Investing.com - U.K. service sector activity expanded at a faster rate than expected in January, easing concerns over the health of the economy, industry data showed on Wednesday.
In a report, market research group Markit said the seasonally adjusted Markit/CIPS Services Purchasing Managers Index increased to 57.2 last month from a reading of 55.8 in December. Analysts had expected the index to rise to 56.3 in January.
On the index, a level above 50.0 indicates expansion in the industry, below 50.0 indicates contraction.
Commenting on the report, Chris Williamson, Chief Economist at survey compilers Markit said, “The January PMI surveys signalled a reassuringly robust start to the year for the UK economy, indicating a quarterly rate of GDP growth just over 0.5%."
He added that, "The data will allay fears that the economy is slowing sharply, having merely seen growth cool during the winter to a more sustainable pace."
GBP/USD was trading at 1.5178 from around 1.5164 ahead of the release of the data, while EUR/GBP was at 0.7552 from 0.7560 earlier.
Meanwhile, European stock markets remained lower. London’s FTSE 100 dropped 0.4%, the EURO STOXX 50 dipped 0.2%, France's CAC 40 shed 0.15%, while Germany's DAX declined 0.55%.